New French Law Means Banks Can No Longer Ignore Blockchain Businesses and Crypto Startups
Of all the nations of the first world, France clearly stands out as being innovative and futuristic when it comes to matters of cryptocurrency and blockchain firms.
In a move that has caught the attention of many, the relevant authority in charge of the financial sector, Autorite des Marches Financiers (AMF), released a guideline that will redefine the entire system. The draft also has the purpose of the testy relationship between crypto startups and the banks.
The new law states that crypto firms can now be guaranteed to have their own bank account. However, this is as long as the firms agree to subject themselves to regulation laws. When compared with the United States, this law from France is no doubt very revolutionary.
In the United States, regulating bodies and government agencies have successfully scared and demotivated banks from giving help to crypto businesses. This was done by constantly harping on the reputation-associated risks that can be incurred by allowing digital currency enterprises to get their own deposit banks. With the introduction of the new law, France has shown that what is going on in the same space in the United States makes no sense.
Domitille Dessertine is the boss of the financial technology, innovation and competitiveness unit at AMF and stated that the impressive feedback they received from the crypto businesses on the advocacy for proper banking services for their transactions met a corresponding approval from the French government.
According to Dessertine, the lawmakers and political leaders of France were overwhelmingly in support of the crypto business owners to have access to their own bank accounts as long as they are subjected to the same regulatory laws as others. Dessertine has also been at the front promoting and organizing the new laws for the past couple of years.
With the new law, banks will now have no valid reason to ignore compliant crypto startups. She went ahead to state that the relationship between the crypto dealers and the banks remains strictly business in nature.
However, in cases where the banks turn down the requests for banking services from the crypto startups, the banks in question will have to explain with full justification why they denied services to the crypto enterprises.
In short, it places the responsibility of justifying refusal of services not on the government but right on the bankers.
She also said that this could be compared with what happened with the crowdfunding market not long ago. That time, banks were also not keen on allowing crowdfunding businesses to get their own accounts.
The reason stated was that the money had the Internet as its origin. But she noted that today that has changed and that also for the new law, all types of banking institutions irrespective of the size will have no choice but to adhere by the new rule.
However, this recent development is just a tip of the iceberg as far as the new law on blockchain ventures is concerned. A part of broader legislation, the government aims to establish a fresh legal setting that will allow small and medium-scale businesses to thrive and grow. The same law also provides generous options to those into initial coin offerings (ICOs) and other stakeholders in the crypto business.
Analysts say that the French lawmakers have shown long-standing interest in freeing up space and removing restrictions that crypto traders have been facing.
Emilien Bernard-Alzias, an attorney in Paris, stated that prior to the introduction of the law, it was a major headache for crypto businesses to have something as simple as getting an account opened. It was just too much of a hassle for them at the banks in France.
However, the game has changed now, and any of the banks that turn down requests for opening bank accounts for crypto-related businesses will have the regulatory authorities to contend with. This is definitely not a challenge that many banks in France will want to take up.
This is an exciting time for players in the cryptocurrency in France, and this was not lost on the Finance Minister Bruno Le Maire who went as far as proposing that the European Union should adopt the bill to serve as a single platform on crypto businesses.